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Sprint, the Unlimited Data Holdout, Says Beware the Shared Data Plan

Sprint is daring mobile device owners to compare its competitors' new shared data plans to its unlimited data plan--now an industry anomaly and Sprint's best bet for differentiation.

Shared data plans may be the norm in our mobile futures, but for now, Sprint is making an argument for resisting them. The only top-three U.S. carrier not to offer a shared planas well as the only one to still offer the option of an unlimited data planSprint has launched a marketing campaign that tells Americans to dare to compare.

By Sprints comparisons (it dares), an individual plan on the Sprint network is $79.99, which includes 450 minutes of talk time, unlimited calls to any mobile, and unlimited messaging and data.

Go with AT&T, says Sprint, and youre paying $118.98 month, for 5GB of dataeach additional gigabyte is $10, should the limit be exceededplus 450 minutes of talk time, unlimited calls to any mobile, and unlimited messages. Mobile hotspot capabilities are included. Over the course of a year, says Sprint, a user could save $467 by choosing Sprint.

Turn to Verizon and order up 10GB of data, and the monthly total, with mobile hotspot capabilities and unlimited voice and messaging, is $140. Choose Sprint instead, the site explains, one could save $720 a year.

Further reading

Complicating things a bitSprint includes an asteriskwas the May 18 announcement that Sprint had changed its hotspot fees for smartphone and tablet customers. To use the mobile hotspot featureor tether other Wifi-enabled devicesSprint now charges $19.99 a month for 2GB of combined 3G and 4G data speeds, or $49.99 a month for 6GB of combined 3G and 4G.

Sprint subscribers requiring the 6GB of mobile hotspot dataSprint estimates that 4.5 hours of streaming music, an hour of watching YouTube videos, 85 uploaded and downloaded photos and nine downloads of apps or games will burn through 1GB of datawill find themselves shelling out as much, if not more, than their Verizon and AT&T counterparts.

Of course, theres something to be said for having the option to useand pay forthe mobile hotspot capabilities.

As Verizon expected, the plans were met with some criticism, despite the carriers promise that current subscribers wouldnt be forced into the new plans. About a month later, as the fuss quieted down, AT&T announced it will offer similar plans, called Mobile Share, in late August.

AT&T had hinted that it would move in this direction, and speaking at a Fortune conference July 17, AT&T CEO Randall Stephenson discussed the evolution of data pricing with interviewer Stephanie Mehta.

I believe the industry has gradually and finally gotten the pricing model right, Stephenson said. Once you get the pricing model right, then I dont think about [which services are] pigs and hogsas Mehta had playfully suggestednow I think about them as services and revenues and its not all bad. In fact, data becomes a good thing.

Current competitor data pricing on smartphones is already complex, driving customer worries about incurring data overage, a Sprint spokesperson said in a statement, responding to a request for comment. The concept of sharing a monthly data allowance across a family of devices significantly increases the potential of a surprise monthly bill due to data overage charges and driving greater customer dissatisfaction. Sprint currently offers customers industry-leading data plans on smartphones providing an unlimited data experience while on the Sprint network that eliminates the worry of any data overage charges.

Sprints decision to be the last unlimited data holdout could also be motivated by its delayed arrival at the Long-Term Evolution (LTE) party. While Verizon now covers 337 markets and offers 12 LTE smartphones, on July 15, Sprint rolled out the 4G flavor to its first 15 cities and a week later introduced its sixth LTE-enabled device.

Differentiating itself through its device portfolio and price plans will be Sprints focus for the second half of 2012, analyst Eric Costa, with Technology Business Research, wrote in a July 26 research note that followed the carriers second-quarter earnings announcement.

While even Sprint CEO Dan Hesse has acknowledged that eventually the carrier will need to move past unlimited data, for now its holding tight to those plans.

The company will keep its unlimited data plans for all LTE-capable devices, including the upcoming release of the next iPhone model, wrote Costa. This will help diversify Sprint from the other Tier 1 operators, who either offer tiered data plans or shared data plans.